Unpaid Losses and Loss Adjustment Expenses

The following table presents a reconciliation of consolidated beginning and ending reserves for losses and loss adjustment expenses.



	Three Months Ended March 31,
(dollars in thousands)	2019			2018
Net reserves for losses and loss adjustment expenses, beginning of year	$	9,214,443		$	8,964,945
Foreign currency movements	28,649			50,766
Adjusted net reserves for losses and loss adjustment expenses, beginning of year	9,243,092			9,015,711
Incurred losses and loss adjustment expenses:
Current accident year	757,970			723,208
Prior accident years	(70,210		)	(108,067		)
Total incurred losses and loss adjustment expenses	687,760			615,141
Payments:
Current accident year	55,999			62,506
Prior accident years	635,980			576,975
Total payments	691,979			639,481
Effect of foreign currency rate changes	(22		)	(294		)
Net reserves for losses and loss adjustment expenses, end of period	9,238,851			8,991,077
Reinsurance recoverable on unpaid losses	5,093,814			4,650,860
Gross reserves for losses and loss adjustment expenses, end of period	$	14,332,665		$	13,641,937

For the three months ended March 31, 2019, incurred losses and loss adjustment expenses included $70.2 million of favorable development on prior years' loss reserves, which included $74.6 million of favorable development on the Company's general liability and worker's compensation product lines within the Insurance segment, and surety, aviation and whole account product lines within the Reinsurance segment. Favorable development on prior years' loss reserves for the three months ended March 31, 2019 was partially offset by $12.8 million of adverse development within the Reinsurance segment related primarily to Hurricanes Florence and Michael, Typhoon Jebi and wildfires in California (2018 Catastrophes).

For the three months ended March 31, 2018, incurred losses and loss adjustment expenses included $108.1 million of favorable development on prior years' loss reserves, which included $93.1 million of favorable development on the Company's general liability, professional liability, workers' compensation and marine and energy product lines within the Insurance segment and surety and marine and energy product lines within the Reinsurance segment.